Large companies, organizations and trade associations join initiatives to increase the amount of recycled polyester content to their products. Last week you could read in an article of ICIS about Textile Exchange working together with the United nations to “commit to bring the percentage of recycled polyester up from 14% to 45% at 17.1 million metric tonnes by 2025.” PET is the most widely used fibre in the apparel industry.
This week UNESDA Soft Drinks Europe announced that beverage packaging will be fully circular by 2030. Meaning PET bottles will be made from 50% recycled and/or renewable PET by 2025, and move to 100% by 2030. These targets go above and beyond the EU’s mandate of 25% recycled content in all PET bottles by 2025, rising to 30% recycled content by 2030.
UNESDA also presented a wish list of areas for support from the EU and national governments, including:
long-term perspective and legal certainty as well as protecting the single market;
a well-functioning secondary raw materials market that gives the soft drinks sector access to sufficient high quality rPET in order to meet its obligations under EU law, without compromising on safety standards and avoiding downcycling;
increased investment in waste management and recycling infrastructure;
an EU framework enabling innovative recycling technologies;
EU minimum requirements for new DRS across Europe
clear definitions of recyclability that foster innovation and investment
We would like to share a new slogan in our logo with you. It is changed into “Driving Circularity”! Written in sky blue it will give us and our customers the right focus for the future.
We also welcomed Paul Burgers in our team this month. His main responsibility will be Business Development and Sales. Paul has a background in (PET-)packaging, labeling & supply chain, always with a sustainability focus. Paul has built up experience from scale up, smaller family companies to large businesses across the globe in various industries.
what you see is what you get
a (good) sense of humor
eager to learn
he is the youngest team member but already with less hair 😉
Container shipping costs have jumped drastically along some routes as the coronavirus pandemic remaps traditional trading patterns and issues at European ports. Add the delays in the region and you’ll understand our worries. Read the highlights of the market impact, disruption, congestion and container shipping alliances in article by Tom Brown of ICIS.
The recovery of multiple key Asian markets from the pandemic, relative to the ongoing struggles faced in the west, has led to a surge in exports from the region to the rest of the world, with less product going back the other way.
The shift in demand patterns has led to containers returning empty to Asia as demand for exports from the region significantly outstripped demand for imports, increasing costs and lead times for orders.
Shipping lines cut capacity drastically during the first wave of pandemic-related lockdowns, and have failed to boost it sufficiently as demand bounced back.
Container availability has been disrupted by too many full containers being stuck in distribution chains west of Suez or in congested ports of entry, with logistics slowed down because of manpower shortages related to coronavirus lockdowns.
Normally freight costs are around $1,500 for a 20ft container. Now you talk about $5,000. It changes every week! The extent of demand has led to shortages in Asia, with shipping firms going so far as to send additional empty containers to the region just to alleviate some of the pressure.
Sources spoke of shipping freight rates for dry cargo rising three- or four-fold, and lead times dragging from six weeks to eight, at a point where demand patterns are extremely difficult to determine due to the trading volatility seen in the market outlook.
Lockdown measures in many European countries are creating additional headaches for the shipping sector, Some sources report the use of smaller vessels to cut down on mooring fees but resulting in reduced vessel space, and shipper terms changing fast.
All the Asian countries are producing and exporting and not importing, because of Covid etcetera.
Shipping lines are saying they can’t respect their contracts. They say: pay or we won’t ship!
DISRUPTION TO PERSIST INTO 2021 Some Asia sources have expressed expectations that freight container tightness in the region is likely to persist until February 2021.
The Chinese say it will last until March or April 2021, then the cycle of containers should go back to normal.
PORT CONGESTION Trade disruptions, bulk orders of medical equipment by governments and geopolitical issues such as the UK’s imminent expected departure from the EU customs union, is also causing congestion at ports and storage issues.
Other key European ports have also had issues, with Rotterdam suffering from delays to arrivals and discharges of shipments due to issues with a new IT system.
The practicalities of operating during the pandemic are also exacerbating delays at European ports, with additional health and safety checks, furloughing, and social distancing also slowing the speed that product moves through the ports.
Lockdowns are expected to ease in most European countries but, with the virus still circulating at high rates and restrictions expected to be temporarily eased for a spell over the Christmas break, controls on contact and the potential for staff shortages from illness remain high.
The issues mean that, while supply chains are largely continuing to hold and orders continue to be met, logistics issues are likely to continue exacerbating demand opacity, economic volatility and shifts among buyers to more hand to mouth purchasing habits, making for a treacherous landscape for firms through to the new year.
CONTAINER SHIPPING ALLIANCES Although shipping cartels were outlawed in 2004, shippers are permitted to operate in alliances to optimize use of shipping space.
The OECD’s International Transport Forum claims that links between these consortia mean a large majority of trade routes to and from Europe are operated by one conglomeration of these groups.
It is concerned that too much information may be shared on volumes, costs and pricing.
The container sector is a lot less fragmented compared to a few years ago. Now the top five owners are controlling close to 65% of capacity.
“The most eco-friendly suitcases in the world!” A revolutionary development by Princess Traveller.
Another good example what can be done with recycled PET (or recycled plastic in common).
It is the first suitcase brand in the world, that has developed a series of suitcases made from recycled PET material; The Green Collection. Where earlier in suitcases only the fabric inner lining were made of recycled PET, Princess Traveller has taken it a big step further. Not only the inner lining, but the full hardcase itself and the zippers are made from recycled PET material.
Also the hangtags and shipping carton are made of environmentally friendly craft paper.
So I suppose, as travelling is an option within the corona restrictions, the whole recycling community will travel in style 😉.
For more details or if you want to order a suitcase, check their website or LinkedIn.
Or just an accelerator in professionalizing the branch?
The questions to be answered:
Are you willing to pay more for rPET if it’s been labeled as Ocean Bound Plastic ?
And what if some of the rPET doesn’t apply to the definition ?
Will traceability and certification be standard in a quality program ?
The term Ocean Bound plastics leads in almost every case back to Jenna Jambeck. The definition of Ocean-bound plastic was defined and published in Science in 2015:
[Waste plastic] found within 50km distance of an ocean coastline or major waterway that feeds into the ocean
The country or region lacks waste management infrastructure and collection incentives
The infrastructure is being overwhelmed by population growth or tourism
There is a significant risk to wildlife if plastic contaminates their ecosystem.
Nowadays companies are offering ocean-bound plastic as an alternative option anduse her definition as a basis for their marketing activities and corporate social responsibility programs. Most of the companies made their own interpretation of the definition and changed or added specifications!
Needless to say that collecting these plastics before they reach oceans is a useful initiative. It is also easier and cheaper than once they have drowned in the bottom of oceans or are dispersed as a soup of micro particles. It is commonly admitted that 80% of plastic in the seas, comes from land.
Using the definition of OBP will introduce the aspect of traceability. It gives converters, buyers, manufacturers and consumers a better insight in the origins of the material next to a better feeling for consumers that they are doing the right thing! Plastic waste and pollution originate from several different sources. Besides Ocean Bound Plastic, also plastic is collected as a by-product of production and manufacturing, in streams, rivers flowing to the ocean, material washed up on coasts and of course in the ocean itself.
Local communities in at-risk areas where plastic will end up in the oceans will profit from the term Ocean Bound Plastic. They will be incentivized to collect, sort and process plastic waste into high-quality recycled material. Also consumers with the option to purchase products packaged in recycled material that has been proven to come from at-risk regions of the world will feel good to contribute to the reduction of waste and pollution.
The same consumers will ask for traceability and preferably a third party certification to be sure they bought the right, more expensive, goods. But can traceability be 100% guaranteed and what will be the consequences for communities and initiatives outside of the area defined for Ocean Bound Plastic ?
The process of making it traceable and also certified makes the branch more professional and helps to achieve quality standards. It also contributes to a better awareness of our worldwide problem with waste and pollution. But these initiatives in the process also make the material more expensive. The questions I have:
Are you as a buyer, manufacturer, consumer willing to pay more knowing where the material, with the same quality, is coming from?
Do you mind if a part of the recycled material is not applying to the ocean bound plastic definition?
Will traceability and certification (more than a CoO or Form A) be standard in the future for any recycled material?
In essence, we should pay more for material from an at-risk area because we prevented the material from entering the ocean. However, the converters and traders are under pressure from brands that want them to supply recycled content at the lowest possible price. It will be a financially challenging situation for recyclers.
Let’s find it out together! Dutch PET Recycling is also working with suppliers offering Ocean Bound Plastic.
Also in Germany the recycling industry is demanding the government to take steps for a sustainable circular economy. Hopefully many countries will follow these initiatives and even more important: will governments take the necessary steps.
The Green Dot (“Der Grüne Punkt”), Werner & Mertz and the German Association for the Waste, Water and Raw Materials Industries demand financial incentives and commitment from government.
Plastic waste in private households increased by 10 percent in recent months as the numbers of home offices and Internet orders went up and the demand for recyclates – recycled plastic from plastic waste – decreased dramatically. What appears at first glance to be a paradox can be attributed to one cause – oil prices. The corona pandemic brought about a sharp fall in the price of oil. Cheap crude oil lowers the cost of producing new plastic and thus reinforces new plastic’s privileged legal status in Germany as it is exempt from petroleum tax and EEC levies. In comparison, the material recycling of used plastic packaging is economically even less attractive. Many manufacturers which previously used recyclates for products and packaging are now switching back to new goods.
That means not only substantial losses for the recycling industry and a giant step backwards for climate and environmental protection, but also a huge blow to the circular economy! Consumers long ago recognized the danger. Surveys show that consumers see plastic as the greatest (environmental) problem. They expect solutions in favor of a sustainable economy and that has not been changed by the coronavirus.
The solution to the plastic pollution of our environment has been known for some time. Used plastic from post-consumer waste collections like the German Yellow Bag can now be recycled at such a high quality that it fulfills strict requirements for use in cosmetic packaging. Plastic remains in a closed cycle, where it becomes valuable raw material instead of polluting waste.
The technology of material recycling, however, is still pushed aside because the use of new plastic is cheaper in comparison.
That’s why three representatives along the supply chain have issued a joint statement in which they demand that the German government use the impending transformation of the economy to establish a sustainable circular economy in general and the reuse of recyclates from used plastic in particular.
Peter Kurth, President of BDE (German Association for the Waste, Water and Raw Materials Industries), appeals to the role model function of public procurement for sustainable management: “The decline in oil prices intensified the already difficult circumstances for many plastic recyclers. Expensively produced recyclates find no takers, investments in better recycling are put off or cancelled because refinancing appears impossible. Given the lack of political action, plastic recycling is threatened with severe damage. Anyone who wants a successful, sustainable economy has to employ suitable instruments that have been known for a long time. An altered procurement process that takes ecological aspects seriously should be at the top of the agenda.”
Reinhard Schneider, owner of the cleaning products company Werner & Mertz and winner of the German Environmental Award 2019, provides concrete solutions to balance out the existing financial disadvantage between the use of post-consumer recyclates (PCR) and of new goods in Germany. “The ecological differential in the purchase prices could be incorporated in the Packaging Law in Paragraph 21 in the form of a fund to which all producers would have to contribute. Only those who use recyclates should receive reimbursement. Additionally, a plastic tax could be introduced which would apply only to new goods, something Italy plans to do. That corresponds to cutting the subsidies for the manufacture of new goods in that the exemption from mineral oil tax and EEC levies no longer apply. The debated minimum utilization rate makes sense only when combined with incentivization for exceeding the minimum rate.”
Michael Wiener, CEO of The Green Dot (“Der Grüne Punkt”), says specifically about minimum utilization rate: “The potential of the circular economy for climate protection, especially for plastic, has not yet been exhausted. We are missing out on the economic opportunities the circular economy offers. A circular economy that earns the name creates jobs and brings urgently needed added value into the European Union. Instead, we are experiencing a complete market failure. Recycled plastic saves up to 50 percent in greenhouse gas emissions generated by new plastic, but that is not reflected in the price. Politicians have to set defined recyclate utilization goals for certain product groups in order to promote the creation of sustainable recyclate markets and provide the necessary investment security. In July 2020 the federal government will take over the EU Council Presidency – a good opportunity to advance relevant measures.”
Summary: A stronger focus on sustainability in public procurement, a fund system, a new plastic tax for new goods and a clearly defined minimum rate for the use of recyclates combined with financial incentives are instruments that will save plastic recycling from extermination and, after the corona crisis, will ensure a stable, sustainable circular economy as an important contribution to climate protection.
Ruim 200 bedrijven hebben het Green Recovery Statement getekend, en Dutch PET Recycling is daar één van. Gezamenlijk pleiten we er voor om duurzaamheid als hoeksteen te nemen voor de corona-herstelplannen.
Goed om te zien dat meer bedrijven duurzamer willen gaan ondernemen en pleiten voor een groen en sociaal herstel. Dit doen wij, en alle partners uit het netwerk van MVO Nederland natuurlijk al jaren. En dat is nodig, want slechts 12,1 procent van de economie is nu duurzaam. Samen bereiken we meer!
More than 200 companies have signed the Green Recovery Statement, and Dutch PET Recycling is one of them. Together we argue in favor of taking sustainability as the cornerstone of the corona recovery plans.
It is good to see that more companies want to do business in a more sustainable way and that they advocate a green and social recovery. We, and all partners from the MVO Nederland network, have been doing this for years. And that is necessary, because only 12.1 percent of the economy is now sustainable. Together we achieve more!
By Matt Tudball (ICIS), Additional reporting by Caroline Murray
Spain’s proposed tax on virgin plastics, announced recently as part of the government’s circular economy strategy, has received a mixed reaction from the European polymers markets. A series of measures that make up the strategy is expected to include a €0.45/kg tax on non-reusable plastic packaging following similar measures adopted elsewhere in Europe including the UK and Italy.
Sources in the market had a lukewarm outlook on the benefit of the tax – the first to be announced by an EU member state since the beginning of the coronavirus outbreak – with several comparing it to the €450/ton Italian virgin plastics tax – which has been postponed until 2021 in light of the pandemic.
“We used plastic products during the covid-19 emergency and now they are thinking of a tax on plastics from January 2021. We are at the level Italy was a year ago,” a Spanish polymers trader said.
“It’s the same discussion Italy had. They asked for €1/kg then reduced the figure after a huge fight between the plastics sector and the government… and now we will have to go through the same fight. Nobody learns from others,” the trader added.
Others were less pessimistic. “This is a tax paid by everybody – everyone is in the same conditions to compete,” one polyethylene terephthalate (PET) producer said.
“The second point is how strong PET material is versus the other [polymers]… I don’t believe that people will go to the supermarket to buy a glass bottle of water. At the end of the day, we will all pay more and the government will get more money. If we all compete on the same terms, it’s more than welcome,” the producer added.
It currently is unclear whether products with a certain percentage of recycled content will be exempt, but this looks likely if Spain follow the same principles as the UK and Italy. In terms of the impact on the recycled market, a buyer of recycled PET (R-PET) believes it may increase competition for post-consumer bottles, the feedstock for the R-PET market.
“Bottles will be scarce, that is for sure. Either collection increases exponentially or we will all be running after the same feedstock material,” the buyer said.
The Italian tax on virgin plastics with less than 30% recycled material was meant to incentivize bottle producers and others to increase the amount of recycled plastic in their product. But as with the UK tax, there are concerns about the size of the tax and whether it will be enough to encourage converters to move away from virgin given current low PET prices.
Using the example of the UK tax, a UK-based PET buyer said, “£200/ton is not enough. If the premium to use recycled content is £600-700, it won’t make people use recycled material – unless people do it for marketing purposes.”
On the other hand, recyclers are worried that the tax will deter consumers from buying plastic products altogether – and more to goods packaged in paper, glass or cardboard.
Dutch PET Recycling is proud to announce that they have signed the European Plastics Pact. We fully endorse the goals and will use our knowledge to contribute in reaching them.
More information about the European Plastics Pact you can find in this article.
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